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HBOS has become the fourth UK lender in a week to announce a multi-million pound writedown on the back of the turmoil in global credit markets, taking the total written off by UK banks in the last seven days to almost Â£2bn (â¬4bn).

The bank this morning said it wrote down £520m on its investments, three days after Lloyds TSB revealed a £200m hit on its own portfolio and a week after Royal Bank of Scotland reduced the value of its assets by £950m as a result of its exposure to US sub-prime.

Northern Rock continued to add to the woes of the UK banking sector, saying this morning it had written down its collateralised debt obligation portfolio by £281m.

HBOS was forced to take a the £520m charge against its £80bn portfolio of floating-rate notes and asset-backed securities.

According to analysts at specialist financial services investment bank Keefe, Bruyette & Woods nearly a quarter of the writedown total was connected to the floating-rate notes, which have seen their values fall as spreads in the credit markets have widened.

Unlike many of its rivals HBOS has minimal exposure to the US sub-prime mortgage market, and the bank’s writedown on its bond and asset-backed securities holding are not linked to the problems in the US.

HBOS has been hit by higher funding costs and last month ruled out selling new bonds backed by residential mortgages because of the turbulence in financial markets. However, the bank said today it was on target to hit its financial targets for the year.

HBOS has cut its exposure to US sub-prime mortages from £550m at the end of August to £430m at the end of last month, and analysts said most of this was in non-traded positions.

Shares in HBOS fell 6.5% this morning on news of the writedown to 779p by 10:41 GMT, but analysts at Citigroup retained their "buy" rating on the stock.